ERM analyzes Supreme Court contract termination ruling
Epstein Rosenblum Maoz associate Nir Shaked has published an article in Calcalist, examining a recent Israeli Supreme Court decision addressing the exercise of contractual termination rights.
The ruling clarifies that even where a fundamental breach occurs, termination is not an automatic entitlement and must be exercised in good faith, with consideration given to the parties’ conduct and the surrounding circumstances. The decision suggests that reliance on strict contractual rights—particularly where a party contributed to delays or uncertainty—may be viewed as acting in bad faith.
The analysis also underscores the importance of carefully drafting “fundamental breach” provisions, noting that broadly worded clauses may not be interpreted as granting unrestricted termination rights.
Read the full article in Calcalist.
